Speech by His Highness the Aga Khan at
The Enabling Environment Conference (Kabul, Afghanistan)

It is a great pleasure and honour to be with you all today. We extend our warmest thanks to all those whose dedication has made this conference possible, most especially to President Karzai and the Government of Afghanistan for their central role - as well as to Prime Minister Shaukat Aziz, who will attend tomorrow's closing session.

Let me also express our deepest gratitude to Prime Minister Badawi for his deep engagement with the subject of this conference - and for the example Malaysia has provided of a successful, pluralistic, Muslim country, guided by the ethics of Islam. This achievement is something of which the whole Muslim world can be particularly proud.

We are approaching the 50th anniversary of Malaysian independence in September - so it is a particularly appropriate moment to salute Malaysia's record as a role model for the Ummah and for the entire developing world.

I am particularly aware these days of the significance of 50th anniversaries, as I will complete, in July, my 50th year as Imam of the Shia Ismaili Muslims.

It is appropriate to both of these anniversaries that we should be talking today about an Enabling Environment for Development - for this has been a central theme in the story of Malaysia since its independence - and it has also been a central theme of my Imamat. In fact, it was on another personal Jubilee occasion - just 25 years ago - that I addressed this topic at the first Enabling Environment Conference in Nairobi.

Over the ensuing quarter century, we have learned a great deal about the nature of Enabling Environments. Among other things, we have been learning to free ourselves from overly simple myths about how development works.

The term "Enabling Environment" has two implications which I would underscore today. First, it reminds us that the conditions which enable progress can be extremely complex, that an entire "environment" of interacting forces must come together if development is truly to take root - and to take off.

Second - the term recognizes that even the right environment is still only an enabling condition - not a sufficient one. Our conference title does not talk about an environment which “solves” or “cures” or “progresses” or “prevails” - but rather about an environment which “enables”. In the end, human progress must grow out of the human heart and soul. The environment enables - but it is the human spirit, guided and supported by the Divine Will, which eventually triumphs.

What a sound enabling environment must do is to create a favourable framework in which human creativity can flourish.

When I have spoken about this topic in the past, I have emphasized such conditions as political stability, safety and security, citizen rights, predictable democratic practices, and a legal and administrative framework which is streamlined and efficient, impartial and effective. While these concerns are largely the responsibilities of government I believe that the ethics of Islam can contribute significantly to their achievement, especially the importance Islam places on mediation and conciliation.

Laying the State’s political foundation is a necessary first step for an enabling environment, but even effective government can take us only so far. And that is why we have been talking more in recent years about two other sectors: first, what I often call the role of “civil society”; and, secondly, the capacities of the private sector.

By civil society, I mean a realm of activity which is neither governmental nor commercial, institutions designed to advance the public good, but powered by private energies. They include non-commercial, non-governmental entities in fields such as education, health, science and research. They embrace professional, commercial, labour, ethnic and arts associations, and others devoted to religion, communication, and the environment.

Of course, the civil sector includes international non-governmental organizations - which are so well represented at this gathering. But they also grow, increasingly, out of local communities and indigenous populations. This is particularly true for Afghanistan, where a broad sense of local commitment, tied to rural villages and urban neighbourhoods, will be an indispensable development force.

Throughout the developing world, we see a new emphasis on the capacities of indigenous organizations to meet development challenges - on a bottom up rather than a top down approach. Voluntary village associations, for example, are undertaking projects which once lay in the political domain - ranging from the installation of water and sanitation systems and the building of irrigation canals, to the provision of educational services and the support of health and safety standards.

In saying all of this, I do not mean to ignore the importance of government. The role of civil society is to complement government efforts, not compete with them. And the same thing is true of a third important partner in a great alliance for development - the private, business sector.

All around the world, private companies of all sizes are a rapidly growing source of progressive energy. Increasingly, they see corporate social responsibility not as something extra - a symbolic after-thought tacked on to the corporate agenda at the end of the day - but rather as part and parcel of their basic commercial strategies. Many companies have set up dedicated departments or corporate foundations to lead such efforts - budgeting a portion of their proceeds to finance them. Other companies encourage and even match the contributions of time and treasure made by individual employees.

We can see a notable example of this potential here in Kabul. Roshan is a mobile phone company, only four years old, but already the largest company in Afghanistan - with over one million customers and nearly a thousand employees. For almost two years now, it has sponsored a department of Corporate Social Responsibility - the first of its kind in Afghanistan.

Roshan sponsors micro-finance projects which enable women to become independent entrepreneurs - selling phone services, or repairing mobile phones. It provides playgrounds, meals, cultural and school projects for street children. It has pioneered in the field of Telemedicine - using fibre optic and microwave links to connect local patients to sophisticated doctors and equipment in Karachi.

Roshan has recently been honoured, for these and other efforts, by the prestigious Committee to Encourage Corporate Philanthropy - an association of over 160 major corporations - as an inspirational business model. .

The Roshan story is one I know well - since the company’s largest shareholder is the Aga Khan Fund for Economic Development. But it is only one of countless examples of imaginative business initiatives.

Let me add one further thought - perhaps the most important. To be sure, each of these three sectors - government, civil society, and the business sector - can accomplish important things on its own. But it is my conviction - that one of the chief obstacles to development in our time is that the energies of all three sectors are too often scattered and fragmented. Too often, the various actors go about their business without enough reference to one another. The result often reminds me of an orchestra made up of talented and dedicated artists - but playing from different scores. The result is not harmony but cacophony - and an unevenness of public impact which is inherently unfair.

Let me be clear: I am not denying the importance of decentralized, pluralistic approaches to development. . But I also believe that the positive impact of all the participants could be compounded if they understood one another even better, talked to one another even more often, and partnered together even more effectively.

Some of you may recall how the World Bank has tried to foster a series of stakeholder fora to encourage better coordination of developmental efforts. I believe that such an effort could have particular value for Afghanistan - where fragmentation and decentralization has been so deeply embedded in the physical geography of the country -and thus in its culture, as well.

Extreme forms of fragmentation have been a barrier to progress in Afghanistan. The most profound example is the fact that much of this country’s economic life – activities related to illicit drug production - falls outside the reach of any legitimate regime. In many developing countries, illicit activities have shrunk as legal authority extends its influence and as alternative licit activities - in the realm of agriculture for example - take on added value. But these processes are still at an early stage in Afghanistan.

Yet even within the sphere of legality and legitimacy, the problem of fragmentation and disconnection is an important challenge. Too often the good things that happen here occur in relative isolation from one another – too often the good people who contribute here lack the sense of mutual support and shared insight which could magnify their impact. The spirit of vigorous individual initiative is deeply-rooted in the Afghan spirit - but it could be tapped more effectively within a stronger framework of cooperation and consultation.

We should not forget, however, that the political history of Afghanistan is also one in which the traditional consultative assembly –t he Loya Jirga - has played an important role. Its objectives have been those of engagement, accommodation and cooperation - and it is in that same spirit that a regular stakeholder development forum in Afghanistan might usefully be convened.

Perhaps our meeting today can add useful momentum to such a process, not only by creating a roadmap for future progress but also by ensuring that this roadmap will be seriously consulted and appropriately adjusted as time goes on.

Many good things might grow out of such enhanced communication. Among them, I would hope, would be an unfolding array of public-private partnerships. The range of such partnerships has been expanding of late - but there is still enormous unrealized potential.

Such partnerships will require a profound spirit of reciprocal obligation and mutual accountability - a readiness to share the work, share the costs, share the risks, and share the credit.

A good example of a successful three way partnership is a recent project to build health-care centres in Afghanistan. Local communities donated the land, the government financed the construction, and the Aga Khan Development Network trained the staff.

Another quite different example in which I have been involved was the creation of
Al-Azhar Park and revitalising the Darb al-Ahmar neighbourhood in Cairo. At least ten different civil, governmental and private groups came together in that effort from at least five different countries.

Such partnerships can have another benefit as well - the partners can learn a lot from one another. A village association, for example, may need help with basic accounting practices. Another group might be creative with local projects, but inexperienced in extending their scale. Various other organizations may be good at long-range planning, or public communication, or legal strategies. Alliances of such entities should continually be comparing notes and sharing best practices.

Nor should such alliances be limited by outmoded geographic constraints. Here, as elsewhere, the future will depend on our ability to rise above the accident of common geography and to rally around common interests - whether our skills lie in apricot processing or tourism, transport or literature or law.

Each step we take to expand our horizons will make the next step easier. In Northern Afghanistan, for example, our network has built several bridges across the Pyanj River to Tajikistan, and it has been gratifying to see how markets have grown up around each of them. And once such interaction is launched, the integration process can accelerate. The regionalization impulse can be a critical part of an effective enabling environment.

Let me close these remarks by asking what may seem to be an impertinent question. How do we know whether these programs are actually working or not? How do we know whether they are improving? It would be very easy to mislead ourselves on this score -and to assume that because we are trying hard, or spending significant sums of money, or are inspired by noble intentions, or are holding a lot of meetings - we must therefore be making an effective impact.

But this is not always the case. And that is why it is so important that all of us should be held accountable for the results we produce - that our work should be measured by its observable, positive impact on the quality of people’s lives.

But how should this measurement be done?

Let me mention in this regard a successful programme we have started in a neighbouring country: the Pakistan Centre for Philanthropy (PCP).

One of PCP’s roles is to function as a standard-setting body - a group that certifies the effectiveness of organizations in contributing to the public good. This certification becomes a “seal of good housekeeping” for such institutions. The score-keeping is done by independent judges in the areas of internal governance, financial management and programme delivery. The goal is to set sector-wide standards and to encourage the widespread adoption of 'best practices’.

The PCP uses its website and databases to tell these success stories in ways which will inspire further successes. You can imagine how such an important effort can help potential allies in their search for credible partners. Even those organisations that fail to meet the standards can benefit, as PCP steps in to link them with specialised capacity-building groups.

The story of the PCP is another sign of a recent maturing process in the development arena. It represents another component of a strong enabling environment.

In sum, meeting the development challenge will continue to be a complex matter - one which will not only demand the very best of government, civil society and private enterprise, but will also require new efforts to coordinate and harmonize their various energies. And it will require discipline in the way we measure and evaluate the outcomes. .

But I would end, as I began, by suggesting that an enabling environment can only do so much. In the final analysis, it can create a framework in which individuals can make the best possible use of their own personal gifts.

An Ayat in the Holy Quran says: “Verily, God does not change a people’s condition unless they change that which is in themselves.” In the end, it is the will and the resourcefulness of the individual human being that, with Allah’s blessings and guidance, will determine our future.

It is to that end that this conference has been organized - and it is to that end that each of us must continually be rededicated.

Aga Khan Agency for Microfinance

Microfinance for Women in Northern Pakistan

Since its establishment in 2005, the Aga Khan Agency for Microfinance (AKAM) has taken over 25 years of microfinance activities, programmes and banks that were administered by sister agencies within the AKDN. The underlying objectives of the Agency are to reduce poverty, diminish the vulnerability of poor populations and alleviate economic and social exclusion. more